In his 2026 State of the Nation Address (Sona), President Cyril Ramaphosa said: “If every small and medium-sized business in South Africa could employ one additional person, we would create three million new jobs.”
On its own, the maths seems to add up until you reckon with the fact that slogans do not hire people. A responsible and responsive state, regulatory sanity, cash flow and many other factors do.
On Tuesday, Statistics South Africa (Stats SA) released the Quarterly Labour Force Survey (QLFS) for the fourth quarter of 2025, reporting that the official unemployment rate fell by half a percentage point to 31.4%, with employment rising by 44 000 to 17.1 million. The presidency had already “welcomed” the improvement.
Behind that modest dip lies a story not of recovery but of retreat. The 2025 Q4 QLFS further reported that the labour force shrank by 128 000, meaning the unemployment rate improved in part because fewer South Africans are even looking for work. Discouraged job-seekers surged by 233 000 to 3.7 million, the highest in recent quarters, while the total number of people outside the labour force swelled by 248 000 to 17.1 million. Read that again: there are now as many working-age South Africans outside the labour force as inside it.
Youth unemployment also tells a worrying story. Stats SA reports it rose to 43.8% among 15-to-34-year-olds in Q4 2025, even as the headline rate fell. Among this age group, the rate stands at a staggering 57%, with 3.5 million young people – 34% of that cohort – neither in employment, education nor training.
When the President speaks about three million jobs, he speaks to this reality. Each job is more than a payslip; it is dignity, demand and the right to say “I’ve got this” in an increasingly unequal society. That is why we cannot afford for three million to remain applause lines rather than an executable programme.
As a business owner whose company currently owns 12 laptops, let me decode this. This is not a moral argument – it is an economic one.
The promise without power
In May 2022, I wrote a piece arguing that the government’s turnaround time was holding back small businesses and that SMMEs were drowning not in a lack of ambition but in a sea of self-created friction. Nearly four years later, I am forced to ask whether anything has fundamentally changed. The answer, regrettably, is that most of what was broken then is even more broken now.
In his 2022 Sona, President Ramaphosa announced the appointment of Sipho Nkosi, former CEO of Exxaro Resources and then-chairperson of the Small Business Institute, to lead a dedicated red-tape-reduction team within the presidency. The mandate was clear: “identify priority reforms,” unblock obstacles to investment and work across departments to simplify regulatory processes. In a parliamentary Q&A, the President confirmed the team would focus on VAT refund turnaround times, onerous licensing, easier SMME access to state business and credit access.
By late that year, Nkosi was telling Parliament that his team had no permanent structure, limited administrative capacity and no real powers. The unit identified almost 100 problem areas but was forced to focus on three: tourism operator permits, mining rights and work visas. Important, yes, but far from the daily regulatory hell that a township mechanic, hair salon or catering company endures at municipal counters and on broken portals.
By 2024, the language had shifted to “capacity building” and pilot “reform action plans” with three municipalities. That is coordination language, not reform language – the vocabulary of process, not outcomes, that a business owner can feel at the till or in the bank account.
I do not doubt Nkosi’s intentions. But a unit with no permanent structure, no enforcement powers and limited public accountability is not a reform engine. It is governance theatre, the appearance of action without the machinery of change. If this is the office meant to make it easier to start, run and grow a business, the credibility of the “three million jobs” appeal is already compromised at its source.
The State as bad client
If the red-tape story is the state failing as referee, the 30-day payment crisis is the state failing as client – and failing spectacularly.
The treasury’s latest compliance report is damning. Across national and provincial departments, 464 188 invoices were paid more than 30 days after issue in 2024-25, with a combined value of R43.6 billion. Invoices still unpaid at year-end totalled 142 801, worth R18.2 billion, a 24% decline in volumes. Provincial departments accounted for 69% of late payments and 98% of unpaid invoices, with Gauteng, KwaZulu-Natal and the Eastern Cape among the worst offenders.
Translate that into the one decision the President’s appeal demands: whether to hire that extra person.
You win a government contract, borrow to deliver, invoice, and then the state does not pay for 60, 90 or sometimes 120 days. Your overdraft accrues interest. Salaries are due on the 25th, regardless. Your debtor book is dominated by a single client that does not pay on time: the Republic of South Africa. On what planet is it rational to add another salary to that equation?
The treasury itself concedes that late payment “continues to negatively impact the financial well-being of small and medium enterprises”. It has reminded accounting officers since 2010 that failing to pay within 30 days can constitute financial misconduct under the PFMA. Yet the system still treats stiffing a small supplier as an administrative delinquency rather than an economic crime.
Late payment does not just kill businesses; it kills demand before it is born. Businesses waiting 90 days for the state to settle an invoice are not expanding payrolls or signing new leases. They are in survival mode, where “one more hire” is not a patriotic act but a suicide note.
Compliance, red tape and the cost of bureaucracy
The Absa/SACCI Small Business Growth Index reports that 52.8% of SMMEs are in contraction, facing difficulties or at risk of closure, with nearly one in ten at risk of closure. The 2024 FinScope MSME survey confirms that approximately three million MSME owners employ 13.4 million people, that more than 2.5 million micro-enterprises exist and that 15% of owners remain financially excluded.
That is not the profile of a sector ready to absorb a three-million-job shock. It is a distress signal from the very businesses we are asking to carry an employment burden the state cannot bear.
The President acknowledged in the Sona that “nearly all” small and medium enterprises face “a multitude of regulations, by-laws, licensing requirements and bureaucratic hurdles”. Yet the flagship responses – R2.5 billion in funding, R1 billion in guarantees and tweaks to credit regulations – are financial sticking plasters over structural wounds. Ask township entrepreneurs what holds them back, and you hear the same refrain: red tape, corruption, broken infrastructure and compliance demands that assume every micro-enterprise has an accountant.
What would make the claim earned
If the appeal is genuine, there are a couple of concrete steps the government can take over the next 12 to 24 months:
• Enforce the 30-day rule with teeth. Make late payment a standing item in every accounting officer’s performance agreement. Treat chronic non-compliance as financial misconduct. Publish a monthly on-time payment dashboard by department and province. If a state entity pays suppliers more than 30 days after payment is due, interest should accrue automatically from that department’s budget;
• Give the red-tape unit statutory powers and a proper backbone. A permanent structure, a clear mandate, real escalation powers and, above all, a public scorecard;
• Make late payment costly: if a state entity pays suppliers more than 30 days late, interest should accrue automatically and be paid from that department’s budget;
• Fast-track the Small Enterprise Ombuds office to give it real power and enforcement mechanisms to mediate and escalate cases of non-payment and unfair treatment, including by the state; and
• Ring-fence 30% of infrastructure procurement for verified SMMEs to benefit from the R1 trillion infrastructure commitment.
None of this is glamorous, nor will it trend on social media. All of it would move the three million jobs line from political rhetoric to a national project.
I want the three million jobs. Every South African does. But jobs, as Ramaphosa’s African National Congress (ANC) continues to discover at every turn, are not created by speeches. They are created where risk is reduced, cash flow is predictable, regulations are navigable and the state acts as a capable, trustworthy partner. On all those measures, the government’s track record is deteriorating, not improving.
The President’s own numbers tell the story: R43.6 billion in late payments, a red-tape unit with no visible scorecard, and a regulatory environment that the National Planning Commission itself describes as a barrier to growth. Until those realities change, three million jobs will remain what they are today – mere political rhetoric. The government must earn the right to ask SMMEs to hire. It has not yet done so.
Lorato Tshenkeng is the CEO of Decode, a Pan-African reputation management and advisory firm.